PT 1 Accountancy

In accounting recording is made of:-

• Personal transactions of the owner

• Non financial transactions

• Financial transactions

• Financial as well as non financial transactions

Which of the following is an example of internal users of accounting information?

• Potential investors

• Creditors

• Management

• Government

Which one of the following is not an objective of accounting?

• To provide information about the private assets and liabilities of the proprietor

• To provide information about the assets liabilities and capital of the enterprise

• To maintain records of business transactions

• To provide information regarding the profit and loss of the enterprise

If accounting information is based on facts and it is verifiable by documents, it has the quality of............

• Relevance

• Reliability

• Understandability

• Compatibility

Which of the following transaction is of financial character and will be recorded in the books of accounts?

• Owner withdrew cash Rs. 10000 for his personal use

• Interviewing the candidates for employment

• Sale of household furniture of rupees 5000

• Entered into an agreement with supplier for providing goods on credit.

Choose the correct sequence of the steps involved in Accounting process.

• Identification- Recording- Measuring - Classifying- Summarising

• Recording - Identification- Measuring- Classifying - Summarising

• Measuring - Identifying- Classifying - Recording - Summarising

• Identification- Measuring - Recording -Classifying- Summarising

1. Financial accounting involves preparation of financial reports.

2. Management Accounting is concerned with ascertaining the money spend on various activities related to production

3. Cost accounting provides necessary information to managers for decision making.

• All the statements are correct.

• Statements 1 & 2 are correct and 3 is wrong

• Statement 1 is wrong and 2 & 3 are correct

• Statements 1 is correct and 2 & 3 are wrong.

Choose the odd.

• Managers

• Bankers

• Creditors

• Government

Using a common unit of measurement and common format of reporting enables …...…...........

• Understandability

• Comparability

• Reliability

• All of these

Which qualitative characteristics of Accounting information is reflected when accounting information is clearly presented?

• Understandability

• Comparability

• Relevance

• Reliability